Nap CoHas Two Products Named X and Y

question 121

Multiple Choice

Nap Co.has two products named X and Y.The firm had the following master budget for the year just completed:
The following operating results were reported after the year was over:
The sales quantity variance for Product X is:

• A)$4,000 favorable.
• B)$5,500 favorable.
• C)$6,500 favorable.
• D)$7,500 favorable.
• E)$16,250 favorable.

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Definitions:

Periodic Inventory System

An inventory system that records inventory levels and the cost of goods sold at specific intervals, rather than continuously.

FOB Shipping Point

A delivery term indicating that the buyer assumes responsibility for the goods and the risk of damage at the moment the goods leave the seller's premises.

FOB Destination

A shipping term indicating that the seller bears delivery costs and retains ownership until the goods are delivered to the buyer.

Sales Bonuses

Additional compensation given to employees, usually sales personnel, based on performance and achievement of sales targets.